Rising crime linked with casinos—study

Press, 21 July 1988, Page 37

Rising crime linked with casinos—study

PA Wellington Casinos in New Zealand would generate $250 million in spending and at least 7000 jobs but could open the door to organised crime, Australian studies show. The conclusions are drawn from the exhaustive study by a former Australian Federal judge, Xavier Connor, in 1983 into casinos in Victoria. The report recommended against their introduction.

The Minister of Tourism, Mr Goff, has appointed a former Chief District Court Judge, Sir Desmond Sullivan, to. chair a similar inquiry and to report to him by Christmas. The Casino Licensing Bill had its first reading, in Parliament recently. The Connor report relied on a Coopers and Lybrand study of Tasmania, where two casinos are run. There, it was found up to 0.41 per cent of disposable income was spent on casino gambling.

That figure was used to calculate the potential effects of gambling in Victoria. In New Zealand, the Statistics Department gave a figure of about $26 billion for disposable income, producing $llO million in gambling potential.

Coopers and Lybrandestimated that that amount of gambling would directly and indirectly generate $250 million in spending. It used an employment indicator to show that would create about 7000 jobs.

But the boost tourism plays in those figures may be relatively small. The Connor report says it is estimated only 20 per cent of spending would come from out of state.

Rising crime associated with casinos, however, outweighed any benefits such as economic activity, increased tourism, revenue or social enjoyment, Mr Connor said.

Evidence from Atlantic City, where casinos were allowed from 1978, tells of

an increase in pursesnatchings, drug-dealing, prostitution and burglaries. a 171 per cent increase in crime occurred between 1977 and 1980 compared with a 26 per cent increase statewide.

Loan-sharking built up round casinos and there was a 45 per cent increase in arsons.

The Connor report said that casinos were the lifeblood of organised crime. They provided opportunities to launder money because of the many unrecorded financial transactions that take place, secret but efficient banking systems, and immense cash flows.

Casinos also provided a flow of money from people unlikely to complain — “compulsive gamblers and the naive.” The report said many of those attracted to casinos were the elderly, many of whom were beneficiaries.

While the report said the Tasmanian casinos had been set up as a

model and were not associated with organised crime, it said their resort settings were small-scale and the state was off the world’s air routes.

Relatively high wages paid by casinos to staff had drawn off people from nursing and teaching who could ill be spared, the report said. Even “unobtrusive” casinos are ruled out by Mr Connor, who said, “You would have to be carved out of chocolate” to take the view they would long retain their original characteristics. Mr Goff has said legislation on casinos would be subject to a conscience vote in Parliament. His view is that they should be introduced with safeguards, and he is supported by the Opposition spokesman on tourism, Mr •Warren Cooper. “They would . help brighten the night life for the tourist industry and would create significant employment,” Mr Goff said.